| Bank Crisis: Yar'Adua directs Ministry, CBN to fast-track AMC setup
From EMEKA OKOROANYANWU, ISAAC ANUMIHE and AMECHI OGBONNA, Kaduna
Tuesday, November
03, 2009
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President Yar'Adua
•Photo: Sun News Publishing |
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In a bid to ensure the stability of the financial sector, President Umaru Musa Yar'Adua has directed the Minister of Finance, Dr Mansur Muhtar and the Central Bank of Nigeria (CBN) governor, Mallam Sanusi Lamido Sanusi to fast-track the process of setting up the Asset Management Company(AMC).
The president also directed the Minister to liaise with the Attorney General of the Federation (AGF), Mallam Ibrahim Dankwambo and other relevant stakeholders to bring the company into reality.
According to the president, the urgent formation of the firm would facilitate an improvement in banking sector liquidity, protection of the earnings of banks from further erosion and a reduction of the debt overhang on the capital market and its participants.
This was revealed at the weekend during the Nigeria Deposit Insurance Corporation (NDIC)-sponsored workshop for Business Editors and Finance Correspondents (FICAN) in Kaduna.
In his presentation, Deputy Director, Banking Supervision of CBN, Mr Charles Akoroda said that apart from providing the much-needed fillip for the Nigerian Capital Market, it will promote transparency and accountability.
He explained that to promote transparency, CBN plans to issue guidelines to the industry to help the banks address the concerns about the low level of transparency and disclosure.
Akoroda noted that the measure was in pursuit of the attainment of the objectives of BASEL 11 and the International Financial Reporting Standards (IFRS).
"Our goal is to ensure that by the end 2010, our banks would have substantially adopted the IFRS minimum disclosure requirement" he said, adding that the implementation of a common year end all banks in Nigeria by December, 2009 was designed to further promote orderliness and enhance transparency.
The Deputy Director affirmed that the global financial crisis and the recently concluded CBN/NDIC joint examination of the banks brought to the fore the weaknesses in risk management and corporate governance practices within banking organizations and regulatory oversight of the financial system.
He, however, stressed the need to engage in extensive introspection, review lessons learnt and together, work diligently to implement programmes to address the lessons.
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